If I had any say, I'd flip education and military budget around, but then we'd have to deal with a soaring unemployment rate, 'cause soldiers can't easily be turned into teachers...
All the points you field are valid and also part of the problem. I also don't see the teacher as some sort of government mandated babysitter so parents can get rid of their brats for at least 6-10 hours a day before they park them in front of the idiot box. A teacher is exactly that. A teacher. His job is to present the curriculum (which by itself needs some heavy overhaul, but let's not get into detail), in a way that the student can understand. It's not his job to make the student pass, it's his job to teach and to test. Period! If a child is disruptive the child may just as well leave the class as far as I am concerned. Actually, I would highly prefer it. If they fail due to them not WANTING to learn it is NOT the teacher's fault.
That doesn't change, though, that the tests themselves are far, far away from reality's requirements. In reality, nobody presents you with some kind of "test task" akin to "solve this equation" or "a triangle is this long and that wide, how long is its circumference". Nobody gives a shit about that. Reality pits you into tasks like "you have a bottle this big, can you fill the contents of a can this big into it or will it spill?"
Such tests needn't be more "taxing" for the teacher, neither for coming up with them nor for grading them. I remember some of my math tests that were quite taxing and tested a good deal of my abilities with less than half a page of specifications and my answers filling roughly the same amount of space. Still took most students the better part of two hours to think it through and figure it out (if they managed at all, but that's a different matter).
How much influence a teacher actually has on the tests, their form and content, of course depends on what he teaches and at what level. I do agree that elementary and high school teachers are very limited in their ability to change tests, with the standardization craze and the "teaching to the test" bullshit that swept the nation. That's what you get if you tie the funding of schools to their "objective" grades. What's the sensible thing to do for a principal? Of course to make sure his students pass the tests with great scores, and that's of course accomplished easiest when you do whatever you can to make them "test-compatible", anything short of outright cribbing is fair game.
But no later than university level, there should be quite a bit of room for testing towards reality.